Last week's indicator review concluded that a resumption of the bull motion needed to encounter novel 20-day highs buy the farm on to outnumber 20-day lows together with a resumption of push clit with sectors, coin flow, together with NYSE TICK. "A motion below the 850 percentage inwards the S&P 500 futures would stand upwardly for a violation of of import back upwardly together with would pause the blueprint of higher lows on marketplace pullbacks." We did, inwards fact, larn that pullback below 850, returning us to good within the trading arrive at that dominated during the latter purpose of 2008.
The pullback took us from a highly overbought order inwards the Cumulative Demand/Supply Index (top chart) to a neutral order together with returned us to a province of affairs inwards which novel 20-day lows ane time once to a greater extent than are outnumbering novel 20-day highs with NYSE, NASDAQ, together with ASE issues (middle chart). Sector technical strength has turned negative; every bit I noted inwards my morning time Twitter update today, solely two stocks inwards my handbasket were trading inwards uptrends; xv were neutral; together with 23 were inwards short-term downtrends.
As the nautical chart from Decision Point (bottom) indicates, the advance-decline describe for NYSE mutual stocks is solely modestly off its recent highs. This relative push clit is also reflected inwards a Cumulative NYSE TICK describe that is non far off its recent peak. Selling pressure level has been intense inwards the fiscal sector; the big enquiry going forrad is whether or non this weakness spills over to the wide market. I volition move watching Cumulative TICK closely together with posting to the weblog on the topic every bit ane means of addressing this issue.
In sum, the motion to cost highs early on inwards Jan has been reversed, together with nosotros are dorsum to seeing 20-day lows exceeding novel highs. As long every bit the novel highs/lows rest weak, I aspect continued cost weakness together with tests of the behave marketplace lows. H5N1 motion inwards a higher house the Jan highs, especially on rigid breadth together with with venture expansion of novel highs, would move decidedly bullish. The starting fourth dimension gild of describe concern for bulls is to sustain prices inwards a higher house the weekly pin of 85.19 inwards SPY. Failure to create together with thus targets the weekly S1 order a flake below 80. (Daily, weekly, together with monthly cost targets are sent out via Twitter, along with daily updates of indicators; subscription via RSS is free).
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